L Capital to merge with US-based Catterton
L Capital, a private equity firm sponsored by luxury goods giant LVMH, will merge with consumer-focused GP Catterton to form L Catterton.
L Capital's existing private equity and real estate operations in Europe and Asia will be combined with Catterton's North American and Latin American business. The partners of L Catterton will own 60% of the combined entity, with LVMH and Groupe Arnault - the family holding company of Bernard Arnault - jointly owning the remaining 40%.
Each fund will continue to be managed by its own dedicated team. L Capital Asia has two funds, having closed the most recent vehicle at $950 million, plus an unspecified GP contribution, in 2013. It is headquartered in Singapore with offices in Hong Kong, Shanghai, Mumbai and Melbourne. L Real Estate also has an office in Hong Kong as part of its global footprint.
According to a release, L Catterton will become the largest global consumer-focused investment firm, with six fund strategies focusing on consumer buyout and growth investments across North America, Europe, Asia and Latin America, in addition to prime commercial real estate globally.
The combined entity will have 120 investment and operating professionals in 17 offices across five continents. Assets under management are expected to grow to more than $12 billion after various successor funds are closed.
L Catterton will be headquartered in Greenwich, Connecticut and London. It will be led by J. Michael Chu and Scott A. Dahnke, currently managing partners at Catterton. Daniel Piette, currently chairman of LVMH Investment Funds and one of the key architects of the L Capital franchise, will remain involved at LVMH.
"L Catterton will provide investors with a unique value creation platform, bringing together our global network and industry expertise with Catterton's long-standing operational approach to building value in consumer investments," Arnault said. "Having been investors in Catterton's funds since 1998, we have participated in its growth and success, evidenced by its strong track record and its distinctive culture."
Catterton was set up in 1989 and has $5.5 billion in equity capital dedicated to middle market and emerging high-growth enterprise. It is the largest consumer-focused PE firm in North America. L Capital Europe was established in 2001 and has approximately EUR1 billion ($1.1 billion) for three funds. The Asia franchise followed in 2009 with a brief to invest in aspirational, affordable and alternative mid-market brands.
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